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« Change in the weather | Main | Fake people and foreign money »

Jan 26, 2010

Comments

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Mick

I am glad that we are in no way liable. But I still want the hotel to be viable.


Hey.... a rhyme. "Anybody wanna peanut"

Fec

I suppose I should be thankful I at least rate a link. And thanks for allowing me to twist in the wind during the early days before the facts came out. Coward.

Tim

I think this is where the confusion lies. People automatically believe that if the government is involved in any way, we are going to have to pay for.

Based on the recent report (on the project AS PLANNED) this hotel may not be viable. Until we see a FINAL proposal under a more thorough study I believe this project can work. The hotel project has evolved quite a bit since last summer and we havent seen the last changes in it. Before writing this project off as a failure we should wait and see what the final product will be. Who knows there may be less rooms and more office/retail. Maybe a combination of apartments. There are many hotel projects like this all around the country. I don't know exactly what Kaplan and Chrisholm is going to finally do but I do believe they understand the challenges and will do what they can to make this project work. Maybe thats why Ed has not written a column in the News & Record writing it off just yet. Like everyone he wants all the facts and to see the final plan before he makes his final judgement. Of course no matter how viable this project is some will always be against it for the simple fact that government is helping period. Some believe government shouldnt be in the process at all even if it wont cost taxpayers. They have a right to that opinion. But if this hotel is built, it should be a great addition to downtown Greensboro.

Ed Cone

Right, let's wait for the final numbers before declaring it a failure -- same logic holds on declaring it a winner.

That's what the bond authority will do.

The problem is that our local gov has blessed the project, at the expense of other possible uses for the money, without knowing those final numbers.

Tim

I agree. It was pretty careless of our city and county leaders. It would be ashame if the bond authority did not approve bonds for the project because we will have lost most of our bond money. This is why I'm really hoping this project succeeds. The Kaplan hotel group does have business sense so im willing to wait and see what they are finally going to do to make the numbers work.

Account Deleted

Via Triadwatch is a nice letter from a consultant to the city:

The developer’s projection of occupancy at the proposed hotel over the
first five years is highly unlikely to be achieved given the recent
occupancy levels achieved by the four hotels that will be primary
competitors of the proposed hotel.

Account Deleted

And this from the letter is pretty enlightening:

The 2009 HVS Hotel Valuation Index report issued in October 2009 lists
Greensboro (ranked 63) near the bottom of 65 cities in the U.S. for
projected changes in per-room value from 2006 to (Projected) 2013. Hotel
values in Greensboro are projected by HVS to fall -47.7% between 2006
and 2013.

Roch101

"As Ryan Shell first reported"

In light of your applause for blogs as legitimate alternative news sources, do you think an un-sourced "I've been told..." is noteworthy, much less "reporting?"

Stephen

His source is very reliable.

Account Deleted

If you only knew what he knew.

I like Keith's approach myself.

Ed Cone

Ryan reported an unsourced item to his readers.

It turned out to be true, so good for Ryan.

I chose not to link it until it was verified.

Making blanket statements about blogs is unwise. Are blogs "legitimate alternative news sources?"

Some of them are, and some are sometimes, and some aren't.

glenwoodobserver

So, this is what we are faced with: IF this hotel project does not project a picture as being financially viable prior to it going to the Local Government Commission, it won't get passed through to be eligible for the bonds, and in this case, Greensboro loses out on the ability to reallocate those bond funds.

As a result, the proponents and the city ought to do everything possible to ensure this project is packaged in a way that it not only looks viable, but actually is viable; otherwise, we've lost out on millions of dollars that could have gone to another bond-worthy project that was actually viable and would have created jobs - the goal of the ARRA bonds in the first place. This could have been the Aquatic Center, it could have been Gateway Gardens, it could have been expansion of the Children's Museum, it could have been a host of any number of projects.

I'm guessing there will be plenty of evaluation of how and why this process got so bungled and why on earth our commissioners and council didn't understand the process, didn't take the time to understand the process nor why they didn't pressure city staff to provide better information. I know, I know, plenty of blame to go around, but I would like to hear our council own up to their part rather than just pointing fingers at staff.

Spag

Don't let Tim or anyone else fool you into thinking that unless the hotel project goes forward, the bond allocation is lost. There is a reallocation procedure wherein the City can rescind the bonds and submit a request for them to be reallocated to another project- if done before the deadline in April.

The whole "it's too late to do anything about it" mantra is false.

glenwoodobserver

Spag - All I have to go on is what is in Killian's story (see below). If you can provide details clarifying that this isn't the case, that would be helpful to the conversation.

"So what happens if the Local Government Commission decides a project is too risky financially?

For the project’s investors, it’s back to the drawing board to seek more conventional financing. But the local governments — Greensboro and Guilford County, in this case — lose their “allocation.” It reverts back to the state.

That’s why backing the right project is so important, Rusher s

Spag

I probably need to clarify- the reallocation process allows the City to request the funds to go to another unit of local government for a project which include a project beneficial to the City. This would appear to include the county, so there is still an "out" there that would keep the bonds local.

An argument could also be made that the notice of intent does not bind the City to the projects listed. It is a poorly written statute that is not well thought out.

Spag

...Of course, reallocation would appear to require some maneuvering, cooperation, and a new project before the deadline. Neither are likely to happen so perhaps Tim is correct as a practical matter. The absence of another project also kind of renders the argument against the hotel moot if one believes that the bonds should be used to the fullest extent.

On the other hand, a bad investment is a bad investment even if someone else pays for it. High Point declined their allocation, and as I've written before- if the federal government is paying for it- you are still paying for it.

Kevin

Tim, Just FYI from your comment earlier today. If the project evolves to a final product that includes apartments, residential rental property, it would then become ineligible for the Recovery Zone Bonds as I read the criteria. Page 8 or 9 in the link.

www.irs.gov/pub/irs-drop/n-09-50.pdf

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